I have a slightly stupid question about selling cars to a dealer.

[WLJayne]

Hey chaps,

I am playing around with finance possibilities again, but being young and foolish I have a question that may help flesh out a scenario I have in my mind. I will probably finance my first mas, right now I'm aiming for a well kept sub £20k QPV. With interest rates being what they are, it seems daft not to just take out a loan on it (plus some of my own cash) over a longish period to keep repayments manageable (less spent on repayments leaves more in the car fund for emergency "Italian Moments" at the garage.) Ideally I'd be keeping ahead of depreciation or at least equal to, this will be a weekend toy that won't do many miles. Now, if I do this, I'd want to make sure that if some disaster befell me and I needed to liquidate the car quickly, I'd not want to be left out of pocket too much. I was thinking that as long as I had decent equity built up in the car, if I had to sell at short notice I could sell to a dealer (preferably performance car specialist) and walk away at least having broken even after paying back the loan or maybe with a little change left over. So my question is, for these types of car, what percentage of the market value could you reasonably expect a dealer to offer you? I have never sold a car to a dealer, so I have absolutely no experience with this and maybe it's anyone's guess but thought I would ask.

I'm just trying to work out how long it would take for me to have enough equity in a car to be in this "safe zone" where if I desperately need to offload it, I won't walk away out of pocket. Of course I'm hoping this will be an entirely unnecessary precaution, but it will make me sleep easier if and when I pull the trigger and put a trident on my drive and a big smile on my face!

Thanks all .

 

[UlstermanAbroad]

The only stupid question is the one you don't ask
This topic has come up fairly regularly, so I know you'll receive accurate answers to your question.
It's something I can guestimate, but I'll let the experts field this

 

[dickygrace]

Too many variables to quantify really, but one thing I would say, there are very few dealers out there who buy QPV's.

 

[Needamaser]

QP's tend to be a slow seller at the best of times. Lot of car for the money but selling on is never quick unless very low miles , desirable spec and priced accordingly.
Richard would be first port of call anyway for advice but maybe a 4200 would be a better bet if you are worried about selling soon?

 

[WLJayne]

Richard would be first port of call anyway for advice but maybe a 4200 would be a better bet if you are worried about selling soon?

I spoke to Richard a little while ago, what a fantastically helpful chap! He also recommended a 4200, and I generally agree with the reasons. My thinking at this point is that if I can find a really sorted QPV at the right price which has trusted history with Migliore (and it's entirely possible there will be one,) I would take the risk as it is the preferred choice. But if I can't manage that, it would definitely be a 4200. The 4200 is already generally more reliable and cheaper to service, so if it's easier to sell quickly then that gives it a big edge on the QP. Honestly, the QP only has the edge in looks - it's the less sensible choice in most other ways. If I can't find an ideal one when I'm in a position to buy, then a 4200 would hardly be a consolation prize, I'd still be overjoyed.

This is really helpful chaps, glad to know the plan at least makes sense!

 

[safrane]

You will be looking at a 15% mark up on the car at the time you buy it.

If you sell you will be looking at at least 15% under book price if you sell it to a dealer.

So you deposit must be at least 30%+ of the original purchase price. So a 6k deposit req.

Any finance will see you paying off their costs before any capital reduction in the loan, esp if its over a long term

 

[Ewan]

No harm in looking at some relevant QP's then typing their reg numbers into We Buy Any Car to see what price comes up. That at least will give you a low book value as a worst case escape route. But if you buy wisely, the on-sell should be okay.

Both my last two QP's sold here on the forum quite quickly, both at around the £15k mark (approximately what I had paid for them originally), and both were then passed on again later at similar figures. Good examples are virtually depreciation proof at that level, as long as the miles are sensible and the history is kept up.

Plenty of great QP's at towards the £20k mark. Look carefully, bargain hard, and you needn't even pay that much. (Unless you want an auto or lo mileage Sport GT variant).

 

[WLJayne]

You will be looking at a 15% mark up on the car at the time you buy it.

If you sell you will be looking at at least 15% under book price if you sell it to a dealer.

So you deposit must be at least 30%+ of the original purchase price. So a 6k deposit req.

Any finance will see you paying off their costs before any capital reduction in the loan, esp if its over a long term

Spot on! Thank you! I was thinking 6k deposit would be necessary to put me close to an even keel right after the purchase. Again this is all worst case scenario stuff, this is all looking extremely doable in the near future.

 

[MarkMas]

... I'd want to make sure that if some disaster befell me and I needed to liquidate the car quickly, I'd not want to be left out of pocket too much....

I fear the bigger issue is what happens if 'some disaster befell' the car. When I was looking for a QP, one dealer said he had someone make an offer on a QP and then drop out because his finance deal came up £1,000 short. Now, since you can easily have a 'disaster' that makes the car unsalable unless you can pay a £2-3-4k bill, you would be really stuck if you couldn't find the cash to put a QP back into running condition, whether or not you could then sell quickly to a dealer.

 

[Ebenezer]

Make sure you can afford to put away 2-3K for bills and servicing per year. If you don't spend it one year, you'll need it the next. These cars are fantastic value to buy, but still exotic to run
Eb

 

[WLJayne]

I fear the bigger issue is what happens if 'some disaster befell' the car. When I was looking for a QP, one dealer said he had someone make an offer on a QP and then drop out because his finance deal came up £1,000 short. Now, since you can easily have a 'disaster' that makes the car unsalable unless you can pay a £2-3-4k bill, you would be really stuck if you couldn't find the cash to put a QP back into running condition, whether or not you could then sell quickly to a dealer.

Yes this is highly likely to happen sooner or later so being prepared is essential. The "Italian Moment" fund will be a constant pot of about £5k to deal with these situations, any surplus after servicing and maintenance will be carried over year to year. That will be no problem to maintain. If something more expensive than that was needed, then I would have to lay the car up for a few weeks to come up with the extra cash. When I say "disaster," I mean something so catastrophic that it means I have to dip into out all my various pots and liquidate some assets. Honestly, I can't think of anything that would be that bad (and our central heating is brand new haha) but the universe has a way of stress testing your lifestyle, I have found!!

Make sure you can afford to put away 2-3K for bills and servicing per year. If you don't spend it one year, you'll need it the next. These cars are fantastic value to buy, but still exotic to run
Eb

As above, completely sensible and should be no problem. When I buy the car, I will have to be able to put up a deposit, a service fund of a few £k, make the monthly payments as well as topping up the service fund for the next year. So basically, I'm going to need about £10k saved for a £15-20k Maserati to be a sane-ish purchase, from the sounds of what you have all been saying.

I think it's time to breathe some serious life back into my side business, and in its best years it has done better than that annually and I can put as much time/effort into it as I need to raise any cash required. So I feel like this is a pretty rock solid plan now, which will leave me well protected and able to enjoy the car and take proper care of it. Nothing like a realistic goal to get you motivated eh!

Thanks all, can't tell you how much I have appreciated your sage advice whenever I have dropped in to ask questions.

EDIT: Just plugged a good example of a 16k QP into WBAC. The offer was £9k. So if my balls were in a vice, I know what I could expect if I needed to sell immediately. But planning like this should mean it would never come to that .

 

[Ewan]

A QP in a normal colour combination, with reasonable mileage and full history will always be worth five figures, so I'd work on a figure of, say, £11k as your "get out of trouble" figure. So if you buy a car at £16k the worse you can do is lose £5k. I'd suggest budgeting on £2k per year as an average to cover servicing and repairs. That has faired me well enough with the 4 QP's I have run as daily cars over the last 10 years.

 

[WLJayne]

Thanks Ewan, that's very encouraging .